What type of franchise was del reys la grande enchilada

Assignment Help Business Law and Ethics

Reference no: EM133193604 , Length: 1 page

Question: Carlos Del Rey decided to open a fast-food Mexican restaurant and signed a franchise contract with a national chain called La Grande Enchilada. Under the franchise agreement, Del Rey purchased the building, and La Grande Enchilada supplied the equipment. The contract required the franchisee to strictly follow the franchisor's operating manual and stated that failure to do so would be grounds for terminating the franchise contract. The manual set forth detailed operating procedures and safety standards, and provided that a La Grande Enchilada representative would inspect the restaurant monthly to ensure compliance.

Nine months after Del Rey began operating his restaurant, a spark from the grill ignited an oily towel in the kitchen. No one was injured, but by the time firefighters put out the fire, the kitchen had sustained extensive damage. The cook told the fire department that the towel was "about two feet from the grill" when it caught fire, which was in compliance with the franchisor's manual that required towels to be at least one foot from the grills. Nevertheless, the next day La Grande Enchilada notified Del Rey that his franchise would terminate in thirty days for failure to follow the prescribed safety procedures. Using the information presented in the chapter, answer the following questions.

What type of franchise was Del Rey's La Grande Enchilada restaurant?

If Del Rey operates the restaurant as a sole proprietorship, who bears the loss for the damaged kitchen? Explain.

Assume that Del Rey files a lawsuit against La Grande Enchilada, claiming that his franchise was wrongfully terminated. What is the main factor a court would consider in determining whether the franchise was wrongfully terminated?

Would a court be likely to rule that La Grande Enchilada had good cause to terminate Del Rey's franchise in this situation? Why or why not?

All franchisors should be required by law to provide a comprehensive estimate of the profitability of a prospective franchise based on the experiences of their existing franchisees

Reference no: EM133193604

Questions Cloud

Describe what stood out to you most in various activities : Describe what stood out to you most in the various activities. Which activities did you struggle with it the most?

Explanation of an appropriate treatment plan : SOCW 6443 Walden University Imagine that you have been seeing a client for a year. Initially, treatment was tailored to address a diagnosis of major depressive

Why law enforcement should have access to guest rooms : American Military University - Explain why law enforcement should have access to guest rooms without a warrant (con) and why law enforcement shouldn't have acce

Interpretation for criteria construction vs maintenance : Portland State University - Research letters of Interpretation for the criteria "construction vs. maintenance" read several of the letters

What type of franchise was del reys la grande enchilada : Florida International University - What type of franchise was Del Rey's La Grande Enchilada restaurant and If Del Rey operates the restaurant as a sole propriet

Discussing testing for sexually transmitted infections : Imagine a scenario in which you and a new partner are discussing testing for sexually transmitted infections. American Military University. CHFD 220.

Explain how electricity works : Explain how we obtain energy from the following non-renewable sources: Crude oil, Nuclear, Natural gas and Coal.

Discuss the senses in which science and technology have made : Discuss the senses in which science and technology have made humanity more distinctive as a species.

Development-relief and education for alien minors : Florida International UniversityThe DREAM Act is a bipartisan legislation that addresses the plight of young people who grew up in the United States and have gr

User Account

All Pages